9911796707
TMI Blog2025 (2) TMI 749X X X X Extracts X X X X X X X X Extracts X X X X ..... of the suspended director of the corporate debtor. The personal insolvency having been commenced on 01.03.2024 not allowing participation of the Appellant cannot be said in any manner affect the meeting of the CoC where it is not even pleaded that suspended management was not invited to participate. It is not the case of the Appellant that the Resolution Plan submitted by the SRA is not compliant of Section 30(2) of the IBC. The jurisdiction of the Adjudicating Authority and this Tribunal to interfere with the commercial wisdom of the CoC is too limited and the Adjudicating Authority and this Tribunal can interfere with approval of the Resolution Plan only when plan is not in compliance of Section 30(2).
Conclusion - There are no grounds to interfere with the Adjudicating Authority's approval of the Resolution Plan. Approval of a Resolution Plan does not discharge a personal guarantor's liabilities.
There are no ground to interfere with the impugned order. There is no merit in the appeal. The Appeal is dismissed. X X X X Extracts X X X X X X X X Extracts X X X X ..... appearing for the CoC. 4. Shri Virender Ganda, Learned Senior Counsel for the Appellant submits that the Resolution Plan which directed payment to be released after decision by the Adjudicating Authority in different application shall lead to reduction of the pay-out to the financial creditors which ultimately shall have bearing on the suspended director and guarantors like Appellant who has given personal guarantee. It is submitted that in the Resolution Plan, it is provided that the financial creditors shall continue to be entitled to avail recourse available to them in relation to the personal/corporate guarantees whereas in the Resolution Plan the liability of the Resolution Applicant has been completely wiped out. It is submitted that the Resolution Plan in a manner is a conditional plan, hence, ought not to have been approved. Counsel for the Appellant further contended that the Corporate Insolvency Resolution Process has commenced against the Appellant w.e.f. 01.03.2024 and after insolvency commencement against the Appellant he has not been intimated to participate in the meeting of the CoC. 5. Counsel for the CoC refuting the submissions of the Counsel for the Appellant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Primarily the Counsel for the Indian Bank relied upon para 5.5 & 5.6 of the plan to say that the entitlement as a dissenting financial creditor is in an amount of ₹18.68 Crores. Therefore, their interest should be secured assuming the plan application is approved. They have no objection to proceed on the plan application. 8. On this issue we note that the COC members against whom the prayer is sought have not been impleaded. Applicant bank Indian Bank is hereby directed to implead other CoC members and prosecute this matter. 9. The members of the CoC represented by Mr. Niranjan Reddy, Ld. Sr. Counsel and Mr. Ankur Mittal, Ld. Counsel fairly state that the entire plan amount may be kept aside in an interest bearing account. All applications including claims of Operational Creditors can be decided separately. The Application for approval of the Resolution Plan should be decided. The claim amount as adjudicated should be distributed to them as per the order of the Adjudicating Authority. In terms of the Resolution Plan the balance will go to the benefit of the CoC members as per their entitlement. 10. In view of the above, the suggested course of action of depositi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... any further action on part of the Corporate Debtor or the Resolution Applicant." 10. The law is well settled that approval of a Resolution Plan does not ipso facto discharge a personal guarantor. The Hon'ble Supreme Court in "Lalit Kumar Jain vs. Union of India and Ors.- (2021) 9 SCC 321" laid down following in paragraph 125:- "125. In view of the above discussion, it is held that approval of a resolution plan does not ipso facto discharge a personal guarantor (of a corporate debtor) of her or his liabilities under the contract of guarantee. As held by this Court, the release or discharge of a principal borrower from the debt owed by it to its creditor, by an involuntary process i.e. by operation of law, or due to liquidation or insolvency proceeding, does not absolve the surety/guarantor of his or her liability, which arises out of an independent contract." 11. Clause 4.6.5 as extracted above indicate that the financial creditor shall continue to be entitled to avail any recourse available to them in relation to the personal/ corporate guarantees which clause has been approved by the CoC and binds all stakeholders. Appellant cannot be heard to say anything against the said ..... X X X X Extracts X X X X X X X X Extracts X X X X
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